Wednesday 26 November
The Chancellor has announced that he has amended the increase in the spirits duty rate with effect from 1 December from 8% to 4%. A revised Pre-Budget Report Note (PBRN28) - Adjustments to amounts of alcohol duty payable (PDF 40K) has been now published. A revised Statutory Instrument will be published in due course.
Monday 24 November
The 2008 Pre-Budget Report was published on 24 November 2008.
All press notices, report notes and HM Revenue & Customs supplementary documents relating to the Report are available by following the links on the left to find out more.
Additional publications relating to the Report will also be available from the HM Treasury Web Site.
HM Treasury have also provided a separate microsite for a Budget Summary Leaflet which highlights the key points of how the Budget will affect you.
The main changes announced by the Chancellor include;
- Changes to VAT
The standard rate of VAT will be reduced by 2.5% from 17.5% to 15% on 1 December 2008. This new rate will apply until 31 December 2009, when it will revert to 17.5%. Only standard-rated sales are affected. There are no changes to sales that are zero-rated or reduced-rated for VAT. Similarly, there are no changes to the VAT exemptions.
- Business Payment Support Service
The Chancellor announced that from today, 24 November 2008, HMRC have introduced a new, dedicated Business Support Service designed to meet the needs of businesses affected by the current economic conditions. This will provide specific help where customers are worried about being able to pay tax, National Insurance, VAT or other payments owed to HM Revenue & Customs.
- Personal Tax, Child Benefit,Tax Credit and
National Insurance changes
- The child benefit increases brought forward to 5th January 2009 instead of April.
- The personal tax allowance increases to £6475, and the basic rate tax limit to £37,400 from April 2009.
- Basic Personal allowance for individuals with income over £100,000 to be reduced from April 2010.
- A new tax rate of 45% on income over £150,000 from April 2011
- Class1 and Class 4 NICs to be increased by 0.5% from April 2011.
- Excise Duty Changes
- The rates of duty for spirits and spirits based Ready to Drinks will be increased by 4 per cent. All other alcohol duties will be increased by 8 per cent (PDF 40K)
- The duty on tobacco products will be increased by 4% with effect from 6pm on Monday 24 November 2008 (PDF 35K)
- The fuel duty rates for 2008 introduced in the Finance Act 2008 will be reinstated with effect from 1 December 2008 (PDF 33K)
- Business Tax Changes
- The planned increase in the Small Company Rate from 21% to 22% from 1 April 2009 has been deferred until 1 April 2010.
- The loss carry back rules are to be extended , for CT accounts ending between 24/11/08 & 23/11/09 and IT accounts ending in 2008/09, by allowing the loss carry back to three years. The amount to be carried back under the new provision is capped at £50,000.
- A package of reforms to the taxation of corporate foreign profits, including the introduction of an exemption for foreign dividends will be in Finance Bill 2009.
- PBRN02 - Corporation Tax Small Companies’ Rate (PDF 35K)
- PBRN03 - Extension of Trading Loss Carry Back for Business (PDF 27K)
- Extension Of Loss Relief Rules – Carry-back Of Trading Losses (PDF 60K)
- PN01 - Facing global challenges: supporting people through difficult times (PDF 236K)
- Air Passenger Duty (APD)
Air Passenger Duty is being reformed, changing from a 2 band structure to a 4 band structure, to take effect from 1 November 2009.